The fortunes of Xplosiv, the budget arm of computer games developer Empire Interactive, has been bolstered by an agreement with Activision, granting it European distribution rights over 30 popular titles, writes Elliott Davis.

In the year to December, Xplosiv contributed £1.8 million towards total group sales of £11.1 million and chief executive Ian Higgins reckons that the deal will easily increase the division's 2002 contribution by £1 million.

Activision is one of the leading US-based games developers and as such Empire Interactive (EMP) receives distribution rights over some well known titles as a result of the agreement. These include Tony Hawk's Pro Skater 2 and Soldier of Fortune.

As a result, Xplosiv can boast a stable of around 80 well known PC-based titles, retailing for either £4.99 or £9.99 each. These games are sold through petrol stations and department stores as well as specialist outlets such as Electronics Boutique and Dixons. Higgins says that this allows the label to generate a higher number of impulse-based sales.

Although Xplosiv only accounts for a relatively small percentage of group sales – developing games for next generation consoles like Sony's PlayStation 2 and Microsoft's Xbox remains Empire's main thrust – Higgins hopes that it will 'underpin' the business.

Intriguingly he also describes today's news as 'one of a number of deals we're going to be announcing'.

Despite Higgins' upbeat mood Empire remained unchanged at 37.5p on the day, a 52-week low.